The very nature of financial or wealth advice should be personal. Not one person’s circumstances, needs, time frame or aspirations are the same, so nor can the advice you receive be identical to that or someone else. Let alone be produced simply by a computer or robot.
All of us only have one life on this earth. Since time is precious and not infinite, we wish to help our clients make the most of their lives and be the best they can be. Not forgetting that it’s important to have some fun along the way.
It’s about value, not price
Price or cost is important, but is never a true reflection of value. We look for value and longevity in our all our dealings with our partners and service providers, for without it, quality may be compromised.
Financial Plans are Outdated
Why persist with the outdated approach of a comprehensive financial plan! Our belief is that greater value can be achieved through focussing on the important and urgent goals first, then deal with the secondary objectives as a progression in the Project Management plan.
These days, no one has the time, nor the inclination to read a 90 page document, let alone execute in a timely manner. Before you realise it, whatever initial assumptions were made, have subsequently altered, often rendering the strategy redundant.
Who Wants to Be ‘Balanced’
Progress should be benchmarked against your personal targets, not measured simply on the basis of a universal benchmark or index eg. Balanced investor or S&P/ASX 200.
The world is not flat and financial markets are not perfect!
Our investment philosophy is based on the premise that economic fundamentals drive financial market and security valuations over the long term. In the short term, however, price movements are heavily influenced by fluctuating investor sentiment; market intervention from the likes of central banks; and the increasing volume of program trading.
Our approach to portfolio construction utilises research on forecasts of future long term returns of all asset classes (the fundamentals), combined with short term price signals (momentum analysis) to highlight potential entry and exit points.
We believe that the old adage “it’s time in the market, not market timing” which drives investment outcomes is naive and inappropriate. Not only has financial market volatility increased as a result of globalisation and technological change, it simply ignores the needs and risk tolerance of individuals. Importantly, the increasing age of our population and their cashflow requirements ultimately introduces the additional, so called, sequencing risk.
Consequently, our portfolio construction approach reflects the following beliefs:
We do believe
Our client’s financial journey and destination are equally important considerations in determining risk tolerance – one without the other may mean inappropriate risk/reward investment decisions.
If the downside or loss of capital is reduced, over time this will result in a greater accumulation of capital than chasing the potential for extraordinary gains.
Income tax, transaction costs and fees matter – it’s returns after fees and tax which fund our clients’ living and lifestyle needs, not ‘before fees’ returns.
There is opportunity to make money from both rising AND falling investment markets.
The elite fund managers have the necessary skill and rigour to consistently excel – one just has to dig deeper to find them.
We don't believe
All financial markets are efficient, all the time.
In a long term buy and hold approach.
That asset allocation is the only determinate of future returns.
Diversification for diversification sake – having conviction with your decisions may bring greater risk, but also brings greater focus and discipline to investment decision making, which ultimately may produce greater reward.
That tracking and aligning to market indices should dominate portfolio construction.